Farmers may abandon environmental initiatives in favour of more intensive food production following the government’s abrupt closure of a key green funding scheme, the National Farmers’ Union (NFU) has warned.

The Sustainable Farming Incentive (SFI) was a central part of the post-Brexit payment scheme that replaced EU subsidies. It rewarded farmers in England for adopting environmentally friendly practices, such as improving soil health, restoring hedgerows, and promoting nature recovery.

Despite the government hailing the SFI as a success with 37,000 funding agreements approved, it announced the immediate suspension of new applications without providing a replacement scheme.

NFU president Tom Bradshaw described the decision as “another shattering blow to English farms.”

Mr Bradshaw said the sudden closure would force farmers to decide “whether to turn their backs on environmental work and just farm as hard as they can to survive”.

Anna Biesty, an organic arable farmer managing a 300-hectare farm on the north Norfolk coast, had intended to apply for SFI funding. Its sudden closure leaves her facing a projected income shortfall of £140,000.

She said that she is now “angry, frustrated and apprehensive about the future”.

“You spend time making plans based on the best information you have but then that plan I made is now pointless. It’s a waste of time and that must be multiplied all around the country, whether it’s farmers or nature charities who are managing land and using similar schemes.

“It just feels like we are being punched at from every angle possible,” she explained.

The Department for Environment, Food and Rural Affairs (Defra) gave little notice before ending the SFI, which was introduced in 2022. Defra stated that over 50,000 farm businesses, covering half of England’s agricultural land, are now engaged in broader environmental land management schemes (Elms).

According to the government, the 37,000 SFI agreements fully allocated the scheme’s budget, preventing further applications. Since 2024, a total of £1.05 billion has been paid or contractually committed to farmers through existing SFI agreements.

The SFI is the largest component of Elms, which replaced EU subsidies with a system where farmers receive public funds for delivering “public goods” such as wildlife habitat restoration. The government reaffirmed its commitment to providing £5 billion over two years for sustainable farming and environmental recovery.

While promising a “new and improved” version of the SFI with a capped budget, the government said details would not be released until later this year.

Daniel Zeichner, minister for food security and rural affairs, said: “This government is proud to have set the biggest budget for sustainable food produce in history.

“More farmers are now in schemes and more money is being spent through them than ever before. That is true today and will remain true tomorrow.”

Bradshaw criticised the move, saying it “slammed shut” the door to funding for thousands of farmers.

He said the closure was “delivered yet again with no warning, no understanding of the industry and a complete lack of compassion or care”.

Victoria Vyvyan, president of the Country Land and Business Association (CLA), which represents rural landowners, condemned the decision as the “most cruel” betrayal. She warned that the closure “actively harms nature” and “actively harms the environment.” With geopolitical tensions rising, she called the decision to undermine domestic food production “reckless beyond belief.”

Martin Lines, chief executive of the Nature Friendly Farming Network (NFFN), echoed these concerns. He highlighted that the gap before a new scheme is introduced would place many farmers in “a really difficult financial position.”

“This has left many farmers feeling frustrated and let down, with no clear opportunity to be rewarded for delivering public goods in the near future,” he said.